Saudi Arabia replaced
Iraq as top oil supplier to India in July after a gap of more than a year,
according to data from industry and shipping sources, as a higher intake of
Iranian oil ahead of US sanctions altered trade
Many European refiners
are winding down purchases of Iranian oil after the United States imposed
sanctions on Tehran, leading to higher supplies to Asia, mainly India and
The sanctions that affect Iran's petroleum sector
will come into force from Nov. 4.
Imports of Iranian oil by India, Tehran's top
oil client after China, surged to a record 768,000 barrels per day (bpd) in
July due to higher intake by state refiners, tanker arrival data showed.
India's top refiner wants to continue buying
Iranian oil as the OPEC member is offering discounts in freight and extended
credit period, Sanjiv Singh, Chairman of Indian Oil Corp, said on Monday.
Saudi Arabia and Iraq continued to be the two
biggest oil suppliers to India last month although monthly supplies from them
declined by 12 percent and about 23 percent in July, the data obtained from
shipping and trade sources showed.
The sources declined to be identified.
On top of incentives offered by Iran on oil
sales, higher July official selling prices (OSPs) of oil from Saudi Arabia and
Iraq also dented demand for their oil.
"Iranian crude OSPs for July have moved in
tandem with other middle east producers but incentives offered by Iran has made
its oil more attractive compared to other alternatives," Sushant Gupta,
Research Director, Asia Pacific Refining, at consultancy Wood Mackenzie.
Gupta said less buying from other importers such
as Japan, South Korea and Europe have also led to more volumes towards India.
"The deadline to reduce Iranian crude is
November 4th. So with this increase in July, India would show bigger cuts in
Iranian crude come Q4 2018," he added.
Saudi Aramco raised July Arab Light crude price
to Asia to 4-year high while Iraq increased the official selling prices for
Basra Light crude to Asia by $0.40 a barrel.
Apart from Iran, India also boosted intake of
Venezuelan and Nigerian oil.
India's imports of Venezuela oil in July rose to
423,500 bpd, an increase of 37 percent from June, as some of the delayed
cargoes from May arrived in July.
Narrowing of Brent's premium to Dubai prompted
Indian refiners to lift more Nigerian grades, said Sri Paravaikkarasu, head of
East of Suez Oil at consultancy FGE.
India's monthly oil imports from Nigeria jumped
by about 50 percent to 422,000 bpd in July, the data showed.